Dalibal invests $2.1 billion to build a manufacturing platform for energy equipment in Saudi Arabia's Spark

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King Salman Energy City “Spark” and Dalipal Holding Company Limited signed a land lease agreement for a period of 25 years, on an area of ​​1,030,916 square meters in Spark, in a step that represents a major milestone in “Dalipal’s” plans to establish an advanced base for the smart manufacturing of energy equipment in the Kingdom of Saudi Arabia.

It is expected that the total investments in the project in the Kingdom will reach about $2.1 billion, while investments in the first phase will amount to about $600 million. These investments will support the development of advanced manufacturing capabilities for seamless steel pipes, including casing and production pipes for oil and gas wells, drilling pipes, and hydrogen pipes.

This project comes as an extension of the memorandum of understanding that Dalibal signed with Spark in November 2024 to develop a facility for manufacturing seamless steel pipes on an area exceeding one million square meters. The agreement represents the project’s transition from the strategic planning stage to the long-term development and implementation stage, according to the Saudi News Agency (SPA).

Under the agreement, Dalibal International Industries, a wholly-owned subsidiary of Dalibal Holdings Limited (HKEX: 1921), will develop the site into a major manufacturing platform serving the Kingdom, the Middle East and international markets.

The project is located in a strategic location within Spark, allowing it to benefit from an integrated industrial system, advanced infrastructure, facilities and logistical services, in addition to its proximity to the most prominent energy and industrial markets in the Kingdom of Saudi Arabia. It will contribute to enhancing local manufacturing capabilities and supporting the localization of strategic supply chains for the energy sector.

The President and CEO of King Salman Energy City “SPARK”, Meshal Al-Zoghaibi, explained that the signing of the 25-year lease agreement represents a turning point in Dalipal’s investment journey in “Spark”, and the first phase investment of $600 million, in addition to the total investment ambition of approximately $2.1 billion, confirms the size of Dalipal’s commitment to the Kingdom of Saudi Arabia, and the confidence of leading Chinese industrial companies in the long-term growth prospects in the Kingdom.

He praised the partnership with Dalibal in creating a world-class manufacturing platform that will enhance localization, develop high-value industrial capabilities, and serve energy markets throughout the region.

For his part, Chairman of the Board of Directors of Dalibal Holding Company, Meng Fanyong, stated that Saudi Arabia represents an important strategic market for Dalibal, and one of the main pillars of the company’s international expansion strategy. The establishment of an advanced manufacturing base in “Spark” will allow the company to be closer to its customers, improve the efficiency of regional supply chains, and build a long-term platform for growth in the Middle East region, stressing his confidence that this project will become a role model for economic cooperation between China and the Kingdom.